A preliminary market research doesn’t need to be expensive or involve vast amounts of resources. It can be done fairly quickly and on a very low budget. We have gathered 10 questions based around 4 key areas: your competition, market, customers and product to help you carry it out.
1. Does your business have Unique Selling Points?
This is what makes you different from the rest of the competition; the reason consumers would come to you rather than your competitors.
2. Does a business like yours already exist?
→ No. If there is no business like yours out there, you may have found a niche market, but ensure you the market research you carry out is thorough. You will have to ensure there is a need for your product.
→ Yes. Then it means there is a market for your product. The question is now to understand if there is room for you in this market.
3. Is the market saturated?
→ No. This is good news. There is room for your product in the current market.
→Yes. Are you able to alter your product to suit a niche market? Sometimes, focusing on a smaller portion of the market, with a slightly different offering, can make your business a successful one.
4. Who is your ideal customer?
This is what the perfect customer for your product would be like.
Demographics – Age, gender, education level
Psychographics – personality type (i.e. risk taker, show off…)
Hobbies / activities / lifestyle in general
Life stage – At what moment in their life (i.e. mum to be, teenager…)
Location – where the product will be used
5. What is your ideal customer’s buying pattern?
How often do they purchase?
How far do they travel to buy the product?
What is the typical budget?
How long is the buying decision?
Who buys the product / makes the decision?
6. How big could your customer base be?
This will need to be large enough to sustain your initial business and its growth.
7. Is your price right?
Is your selling price the right one for the customers you are targeting? For example, a cheap price for a luxury market wouldn’t work and vice-versa.
8. How does the economy look for this kind of product?
Is it the kind of product that is becoming more and more popular or have you arrived too late in the game?
9. What are the benefits of your product?
What would be the main motivation in your customers purchasing your product? Will the product improve their life?
10. What would motivate the purchase?
This is the reason for buying your product. Which features, characteristics or benefits would motivate the purchase?