How to Do Market Research for a Startup

In the past year, over four mil­lion star­tups were cre­at­ed world­wide! Most busi­ness­es fail due to a lack of fund­ing, inad­e­quate man­age­ment teams, faulty busi­ness mod­els, or unsuc­cess­ful mar­ket­ing ini­tia­tives. That’s why it should be a pri­or­i­ty to gath­er indus­try infor­ma­tion before mak­ing cru­cial busi­ness deci­sions as an entre­pre­neur. For start­up sus­tain­abil­i­ty and growth, you must know how to do mar­ket­ing research. We’ll share with you how to do mar­ket research for a start­up and why it’s so impor­tant. These steps will also show you how to do mar­ket research for a busi­ness plan. 

What is Market Research for Startups

If you’re new to the start­up mar­ket, you are in good com­pa­ny! For those con­sid­er­ing cre­at­ing a start­up, now is a good time to start off on the right foot. Con­duct­ing mar­ket research for star­tups can give you an advan­tage over oth­er busi­ness­es that have not tak­en the time to under­stand the indus­try they work in. We know you want to be bet­ter pre­pared than the com­pe­ti­tion and remain focused on align­ing your goals and objec­tives to what is hap­pen­ing in the mar­ket­place. That’s what mar­ket research for star­tups is all about. 

It is the process of gath­er­ing infor­ma­tion about the mar­ket you intend to do busi­ness in includ­ing com­peti­tors, poten­tial tar­get audi­ence, and the con­di­tions you’ll be fac­ing. Dur­ing mar­ket research, you’ll learn about sig­nif­i­cant trends, pric­ing, mar­ket­ing meth­ods, and prospects. When you know your poten­tial mar­ket, you’ll be able to con­nect and serve them bet­ter. All of this infor­ma­tion can be found for free on the internet!

How to Do Market Research for a Startup

Now you need the steps that can sharp­en and improve the direc­tion of your busi­ness. Whether you want to grow into a large enter­prise or remain a small busi­ness, know­ing how to do mar­ket research for a start­up will make all the dif­fer­ence between you and your com­peti­tors. Here’s where to begin: 

• Define the pur­pose — One of the most impor­tant activ­i­ties of con­duct­ing mar­ket research is defin­ing your pur­pose for gath­er­ing this infor­ma­tion. Under­stand­ing what you want to accom­plish will shape the direc­tion of your search and pro­vide an objec­tive to accom­plish. Some ques­tions to con­sid­er when defin­ing your search pur­pose include: 
  • Are you con­duct­ing inter­nal research to iden­ti­fy mar­ket problems?
  • Are you con­duct­ing exter­nal research to find mar­ket dri­vers and barriers? 

To effec­tive­ly con­duct mar­ket search, you should have a plan. When it is well defined, it will save you time and mon­ey in the long run. It is essen­tial for sus­tained busi­ness growth and progress. 

• Ask ques­tions — Dur­ing the plan­ning process of your mar­ket research, you’ll want to ask spe­cif­ic ques­tions about your indus­try to inform your cur­rent and future deci­sion-mak­ing. Answer­ing these mar­ket research ques­tions can help you define what you should focus on when build­ing your business: 
  • What is the poten­tial size of my market?
  • Who are the com­peti­tors and how big are they? 
  • Can my busi­ness fill a niche? 
  • What mar­ket share does my busi­ness and my com­peti­tors have? 
  • What is my business’s com­pet­i­tive advantage? 
• Con­duct mar­ket and com­peti­tor analy­sis — When you begin the mar­ket research process, you’ll want to scan the entire indus­try and poten­tial com­peti­tors to iden­ti­fy oth­er com­pa­nies that pro­vide sim­i­lar prod­ucts or ser­vices. Ana­lyz­ing your com­peti­tors’ busi­ness activ­i­ties, as well as their strengths and weak­ness­es, can give you an idea of what needs your busi­ness can imme­di­ate­ly fill. Speed up the mar­ket research process by using ana­lyt­i­cal tools specif­i­cal­ly for star­tups or small businesses. 

Whether you choose to use research tools or not, rec­og­niz­ing KPIs, or key per­for­mance indi­ca­tors will give you an idea of how well a busi­ness is doing and what the sus­tain­abil­i­ty needs are. You can uti­lize tools that can fol­low your com­peti­tors’ social media plat­forms, media cov­er­age, com­ments, and men­tions to get an idea of their brand aware­ness and devel­op­ment. Most star­tups oper­ate on a lim­it­ed bud­get so it’s a good idea to choose a tool that you will get the most use from. 

• Ana­lyze poten­tial audi­ence — Once you’ve learned all you can about your com­peti­tors and the mar­ket in gen­er­al, you’ll want to focus on poten­tial cus­tomers by ask­ing your­self these questions: 
  • Who is my ide­al audience? 
  • What is their profile? 

Have you cre­at­ed a busi­ness plan yet? This is how to do mar­ket research for a busi­ness plan. By iden­ti­fy­ing your cus­tomer demo­graph­ic, you’ll be able to devel­op effec­tive mar­ket­ing strate­gies that will con­nect with poten­tial buy­ers of your prod­uct or ser­vice. Many busi­ness­es fail because they haven’t made a con­nec­tion with the cus­tomer they are serv­ing. A deep dive into your cus­tomer demo­graph­ic should include pref­er­ences, per­son­al­i­ties, and inter­ests that will shape your mar­ket­ing efforts down the road. You want to estab­lish loy­al­ty by under­stand­ing their moti­va­tions and meet­ing those expec­ta­tions by con­nect­ing them to what you offer. 

Loy­al cus­tomers will increase your rate of return when you devel­op spe­cial offers and pro­mo­tions that they respond favor­ably to. A well-struc­tured out­line of your tar­get mar­ket should also include an esti­ma­tion of mar­ket seg­men­ta­tion, mar­ket poten­tial, and mar­ket size. 

We Do Market Research for Startups

All of these steps play a role in how to do mar­ket research for a busi­ness plan. The infor­ma­tion gath­ered will form the basis of your busi­ness plan and strat­e­gy for growth. Cre­at­ing a com­pre­hen­sive pro­file of your tar­get audi­ence will serve as part of your mar­ket­ing plan. These valu­able insights are trans­fer­able in sev­er­al ways when devel­op­ing a strat­e­gy for your busi­ness. You just need to take the first step. 

Our award-win­ning team has helped many star­tups like yours find direc­tion and grow their bot­tom line. We are focused on part­ner­ing with you to cre­ate inte­grat­ed mar­ket­ing strate­gies that make an impact and get you noticed. For busy entre­pre­neurs or over­whelmed mar­keters, our ser­vices save you time and mon­ey so you can focus on oth­er aspects of grow­ing your busi­ness. We pro­vide sup­port for your goals and accom­plish­ments by con­duct­ing a com­plete assess­ment of your entire mar­ket­ing infra­struc­ture and devel­op­ing a plan. 

Give us a call today for a free mar­ket­ing audit to get started!