Do Market Research Before Starting Your Business

April 14, 2022
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The study of your market (which extends to the customers and competitors of your future business) is an essential step in the success of a business creation project. It refers to the collection and analysis of information relating to a specific market. The objective is to know all its characteristics. Indeed, a good starting idea is not enough to create a profitable business by a trade advertising. You also need to know the market you are going to enter.

Indeed, how to consider selling if you do not know to whom and next to whom you are going to sell? Even if you innovate, you have a market to identify and analyze. Depending on your project, several market research techniques exist.

Objectives of the chapter on market research

The purpose of this chapter: to help you analyze your customers in detail (who are they? how do they behave? what are their needs? where are they?) and your future competitors (direct, indirect, or even future).

Thanks to the market study, you will have all the elements for:

·         validate or develop the “customer segments” part and the “value proposition” part (the “product-market” couple).

·         confirm or change the “revenue flow” part.

·         prepare your communication, distribution, loyalty, and prospecting strategy from a brand strategist.

Understanding Market Research

Market research is therefore an in-depth analysis of your customers and competitors, or even of the various business stakeholders according to their impact on your business (distributors, contractors, etc.). But what should you do if the market in which you want to position yourself does not yet exist? Is the customer need being poorly defined? And how do you go from your initial idea to turnover?

In this article dedicated to understanding market research, we explain everything to you.

Act: segment customers

You are not selling to everyone. You are selling to a well-defined customer segment, whose socio-economic profile, habits, and behavioral characteristics, among other things, you will analyze! In this way, you will have the necessary information to capture the attention of your customers, speak to them with the right words, and therefore sell them what you produce.

In this article, we give you more information about segmenting your customers. We also give you tools to categorize them and methods to create “personas”, which are typical customers likely to need your products and/or your services.

Understand customer emotions

“Understanding the customer” means focusing on his emotions. Indeed, in general, and for the purchasing process, no one is a “rational machine”, making decisions solely based on price, type of service, or product. Certain characteristics, important, can mark us, strike us, and ultimately prove decisive for the purchase.

Your market analysis must therefore extend to these different aspects. For this, we offer you a very easy-to-use tool: the empathy map. Beyond the details already provided by the Value proposition canvas and the Lean canvas, it allows you to note and analyze the emotions of your customers, according to their profiles.

Identify customer buying motivations

So far, you have defined the profile of your customer base and analyzed the potential emotions felt by this segment. That’s good, but there’s still a bit of work to do. You must now understand which purchasing mechanisms will decide your customers. Are they looking for security? The novelty? What are their fears? Do they favor hedonistic purchases (those that give pleasure) or ablative purchases (those that give pleasure to others)?

By defining all of this, you will identify your customers even better and it will be easier for you to meet these needs precisely.

The stages of the buying process

Good! Now that you know your target clientele, their habits, and their emotions, and this at your fingertips, you still must learn what are the main stages of the purchasing process, from noticing a lack to a “feedback ” client. This is the subject of this article.

Marketing study: setting a psychological price

Knowing your customers is not everything. Again, address her with the right words… and with the right prices. Your customers will agree to pay a certain price for the products or services you offer, but they will turn away from you if the price turns out to be too high for them. On the other hand, too low a price can mean “poor quality” and scare away. It is therefore advisable to rely on the psychological (or acceptance) price to determine your final price. We tell you more about it in this article.

Understanding customers: several examples

Let’s take everything we’ve seen so far in the form of examples. We invite you to discover two concrete cases of customer analysis. We stop in particular:

·         on fictitious customer profiles.

·         on understanding their emotions.

·         on the motivations and barriers to purchasing.

·         on the main stages of the act of purchase.

Know the competitors

The presence of competition is paradoxically a good thing: it means that a market exists, and therefore that you have the means to position yourself there. However, it is essential to know how to stand out. For this, a thorough analysis of your competitors is necessary. In this article, we give you the keys to collect the necessary information and target “direct” and “indirect” rival companies. We also present two fictitious examples which allow you to see things more clearly and nourish your reflection.

To position yourself

 You don’t sell what others are already selling. On the contrary, even if your products or services are like those of your competitors, you will seek to stand out and create for your company an identity of its own.

In an article devoted to the economic positioning of the company, we remind you of a few theoretical points and above all, we offer you a concrete method (the Blue Ocean) to determine this positioning. This will allow you to appear as a unique actor on the market, and not as the “copy” of another company.

In this same article, always to feed your reflection, we give you keys to achieve your strategic positioning canvas, as well as fictitious examples. Finally, we provide you with information on the value curve.

Market research methodology

Finally, at the point where you have arrived, it is high time to give you some methodological elements on market research! Before anything else, we would like to remind you of a few fundamental points for success (precisely define your target, set objectives, go out or pick up your phone to carry out interviews, etc.).

 

We then give you useful information on the choice of method, which can be quantitative or qualitative, as well as on the choice of people to interview. We also give you advice on how to write your questions correctly (these must be clear, not redundant, not biased, etc.). Finally, we provide you with details on surveying an innovative product or service.

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