Conducting market research for your e-commerce business ideas is both wise and essential.
Investing your time going through this process will help you to precisely determine whether or not there is a strong demand around your business idea.
It also helps you, as an entrepreneur, to make better business decisions and avoid costly mistakes.
If you need to be successful online, market research is the way to go; whether you are a newbie or an expert in the e-commerce industry. Entering a new market, looking for potential customers and launching new products require in-depth market research to source essential information that will guide you in all this.
Therefore, it is essential to set up a well-designed market research plan that will guide you to make the right decisions at the right time. Poorly designed executed research plan leads to results that will steer your business in the wrong direction.
So, what is market research?
For any business to be successful with the current stiff competition of the mighty internet, it should have proper and extensive knowledge of their customers and their competitors. Therefore, market research is the process of gathering information which will eventually help you to be more aware of how your followers will react to your products and services. When you talk to your customers about your brand or investigate the price and services offered by your competitors you are conducting market research. Leveraging the process can result in significant information about your products and services, your followers and the overall market under which your business is operating.
Why conduct market research?
The primary aim of doing market research is to prepare yourself with the information you require to make sound business decisions about your business’ set up, innovation, growth and the 4 P’s (product, price, placement, and promotion).
Moreover, you need to understand market dynamics. Knowing and understanding your market also means understanding external factors that could affect your business success.
Various changes taking place in the industry every day such as economic conditions shift, business emergings, regulations change, and technological breakthroughs could either enhance or destroy your market opportunities. However, when market research is done correctly, it will mitigate the risk associated with this.
Therefore, Conducting a market study will help you answer these and other questions:
- Which solution works best with your business?
- Where do your followers need help?
- How can you help customers solve problems?
- What external factors; such as competition, standards, market conditions, and regulations could affect your success?
- Can people afford your products and services?
- How are your competitors playing the game?
- How should you approach the market?
When should you conduct market research?
Business research is mostly considered as a foundation of the planning stage of any business. It is very critical for both start-ups and experienced business people and should be a core element for any entrepreneur’s business plan.
Some of the significant business changes taking place days and nights, such as business expansion and relocation are some of the events calling for market research. Other examples of situations that might call for market research include;
- New advertising campaigns
- Opening a new location or changing business locations
- Increasing production levels
- Introducing new lines of products or services
How to conduct market research?
The first step starts by determining clear goals for your market research activities. You have to define what you need to know and why.
Once you have established your goals, it is vital to set up a sound strategy and select relevant techniques you will use to gather information.
Define your buyer persona
Before you determine how customers in your business circle make buying decisions, you need first to understand who they really are. Defining your buyer persona is the beginning of your primary market research, where buyer personas come in handy.
Buyer personas are representations of your ideal customers. They help you visualize your audience, streamline your channels communications, and set up your strategy. Some key characteristics you should be keen on including in your buyer persona are the age of your potential buyers, their gender, the geographical location of your customers, their significant challenges, their profession, their family size, e.t.c.
The idea behind this persona is ultimately to use it as a guideline when you reach and learn about actual customers in your business.
Find trends and put the big picture in perspective
Another cool Google tool you can use to find tends is Google Trends.
You need to do a search for a product or business idea, and then view the directional search demand for that keyword throughout the past few years.
This can be done well by comparing the volume of searches between a few terms, geographic locales and even view how particular events affect search popularity.
Search using keywords
By using different search engines, you can search for keywords that people search on the internet to gain knowledge about various products and services. This can help you to understand where the interest of the consumer lies based on the keywords you search including gaining critical insight about your prevailing competitors in the market.
Through keyword search, a business can also gather helpful knowledge about different product position, place, and function which it might have overlooked. All these advantages that the market research online survey offers warrants the business conduct of keyword searches.
Identify content competitors
You can also use the search engine to find all relevant information about your competitors in the market such as their product, prices, and services. Searching about your competitor provides helpful business information about the sites that are linked to the competitor’s website. By this, you will use this information to improve your overall service to your target customers.
Search through conduct of online surveys
Another popular method to understand the opinion of consumers is through the conduct of an online survey. The advantage of online surveys among new as well as established businesses is purely due to its low-cost budget.
Also, these particular techniques provide instant feedback about your followers opinion such as whether a specific product when hitting the market will be loved with the consumers or not.
Start off by choosing the right software to conduct your surveys. Sites like Zoomerang and SurveyMonkey are great because they also offer reporting options that can easily be exported for your own personal use.
Research social media Blogs and Websites
Social media is a great resource when it comes to getting feedback and free yet helpful marketing data. Social networking sites like Blogs, Websites, Twitter and Facebook are arguably the best ways of getting qualitative information in a short period.
Facebook and Twitter allow you to create lists that you may want to use for your market targeting. On the other hand, researching blogs and websites of competitors and fellow companies is another cheapest form of the direct survey for your primary data collection. Companies regularly update their content which is essential for analysts to be updated with this easy-to-access, free information for their time to time business decision.
Invest in feedback popups
Feedback popups are gold mines when it comes to market research. Take for example, when we are being asked to rate and comment on every app that we use, websites ask us to give our feedback to them after we are done using them. When you also invest your knowledge in such a method, you will be able to gather useful information about your products, which you can extract to make crucial decisions hence improving your services.
Build an online store and test the waters
Why can’t you give a trial now? You can build your e-commerce and test the waters to gain momentum. You can do this long before your product or service is ever developed to start driving traffic or even to collect some pre-orders.
In a nutshell
Market research comes with lots of benefits to your business. Therefore, it should be done from time to time, for a better understanding of arising market opportunities and change in customer demand.
Here are summary points explaining why your business needs market research to sustain and grow in the modern market;
- Identifying problem and opportunities in the market
- Formulating solid market strategies
- Managerial decision making
- Increased Sales.
- Better Customer Management service.
- Determining your consumer needs and wants
- To facilitate smooth introduction of new products and services
- Monitor your competitors
- For sales and profit forecasting
- Minimize loss in your business
- To revitalize brands
- For effective communication mix
A well‑planned market research plan can help you make useful business decisions. Not only can marketing research help you determine if there is an ideal market for your products, but it will also help you improve your products to fit your customer needs and desires.
Although your research may not fill all the gaps in your business, especially under the constraints of a tight budget, it has the potential to improve your overall decision making dramatically. And that can mean the difference between business success and failure.