The goal of doing market research is to equip yourself with the information you need to make informed business decisions about start-up, innovation, growth and the 4 ‘Ps’: product, price, place and promotion.
Product — Improve your product or service based on findings about what your customers really want and need. Focus on things like function, appearance and customer service or warranties.
Price — Set a price based on popular profit margins, competitors' prices, financing options, or the price a customer is willing to pay.
Placement — Decide where to set up and how to distribute a product. Compare the characteristics of different locations and the value of points of sale (retail, wholesale, online).
Promotion — Figure out how to best reach particular market segments (teens, families, students, professionals, etc.) in areas of advertising and publicity, social media, and branding.
Part of being prepared with market research is avoiding unpleasant surprises. Intuition and experience can be helpful at times, but research and facts often paint a more accurate picture of your market.
By conducting research on a regular basis, you can keep up with the dynamics of the economy and demography. You can also adjust to new regulations and technological breakthroughs.
Market research can help you:
Understand your customers and their preferences (4 Ps)
- Profile your customers (location, age, gender, income level, etc.)
- Create more effective marketing campaigns
- Find the best business location
Identify opportunities to grow and increase profits
- Recognize changes in demand
- Offer new products or services for the new demand
- Find new markets within and outside of Canada
Recognize and plan for industry and economic shifts
- Shift inventory, price and staff levels as needed
Monitor the competition in your market
- Identify competitors
- Get information on how your competitors operate
- Learn how customers compare you with your competitors
Mitigate risk in your business decisions
- Use information, not just intuition, to drive your business decisions
Common Research Questions
- How large are your potential markets?
- What markets are currently buying products like yours?
- Who are your competitors, from which cities/markets do they come, and how large are they?
- What are the required standards, testing, and certifications?
- Do your products (or their labeling or packaging) need to be modified for one or more markets?
- What duties, taxes, and other costs apply? What are the shipping costs and partner margins? What is the shipped cost?
- Is your price point appealing within the market? If not, what can you do to make it more appealing?
- What distribution channels are available?