Coming up with a new business idea is often the start of a great adventure. But much like any significant journey, a little prep work goes a long way.
Maybe you've thought up an innovative way to fill a market gap or have ideated a product that will entirely change the landscape of your industry. Whatever your story may be, the same question will always arise: "Will people buy it?"
While you can choose to take your chances in the market, there are tangible ways to set yourself up for success early on in your development. By taking the time to understand your market, ideal customers, and the competitors in your space, you'll likely find that breaking into your industry becomes that much easier. Read on to learn more about market research for startups- and thank us later 😉
What is Market Research?
Market research is the gathering of information about your target audience, competitors, and industry trends to guide your business decisions.
But it's not something that you do just to confirm your idea is indeed a good one.
Good market research allows you to evaluate what is already available to consumers and how it is (or isn’t) meeting their needs. It provides you with a window into consumers' minds, allowing you to discover the real challenges they face and what you might be able to do to ameliorate them.
Why is Market Research Important for Startups?
The goal of any business should be to delight its customers. But if you’re not asking your customers what they want how will you ever know?
When you’re entering a new industry, you’ve got to understand the current landscape so that you can hold your own against the larger players in your space. And market research allows you to do just that through the exploration of your audience's thoughts, feelings, and opinions.
This will help you remove the guesswork in your decision-making and open the lines of communication between your business and your customers.
Ultimately, the insights you glean will inform your product or service development and help you discover the messaging and branding that resonates best.
How to Use Market Research as a Startup
While the prospect of conducting your own market research may seem daunting, it is becoming increasingly accessible regardless of your time, budget, or expertise. This means you won’t need to hire an entire insights team or find an agency to outsource your research to. Instead, you can use DIY tools that make it simple to research aspects of your business like:
Great products don't happen by accident. Their development is often the result of thorough research and testing. Understanding what your prospective customers are currently using and what they feel is missing is key to product adoption. This type of research is ongoing and iterative, allowing you to insert your insights directly into your product development cycle. Concept tests, heatmaps, conjoint analysis, and MaxDiff experiments can all be incredibly helpful here.
Building a strong brand is crucial for startups. But unlike sales and marketing KPIs, brand metrics can feel intangible if you're not sure what to look for. Early in your journey, you'll want to experiment with your brand's look and overall identity. Long-term, conducting brand research that tracks awareness, perception, usage, loyalty (and more) can help you optimize as you grow.
Market Segmentation / Personas
You will learn quickly that not all customers are the same. While some may seek out your products or services for one reason, others may come to you for entirely different reasons. By identifying the segments within your potential customer base you can better understand the specific needs, problems, and motivations you'll need to speak to. Using segmentation tools you can create robust personas for each of your buyer types, allowing you to deliver more impactful messaging, ads, and collateral.
Marketing & Advertising
We've all seen ads that fell flat. Sometimes the result is a (relatively) harmless low ROAS. But other times it can ignite a fierce consumer backlash (looking at your Kendall Jenner + Pepsi). Testing your advertisements and marketing material with your target audience before launching can make all the difference for your messaging, visuals, audio, placements, and more.
How Startups Can Conduct Their Own Market Research
There are many ways to go about conducting your own market research but your results will vary based on the methodology and tools you choose. Here are a few quick tips to get you started:
Set Goals and Objectives Early: Before beginning any market research project you’ll need to clearly identify the questions you are trying to answer and how you plan to use the data. If you've got a team, this is a great time to collaborate and define what you want to learn and how you'll use the insights once you have them. The more specific you are here, the better!
Find a (Great) Tech Partner: Picking the right platform is crucial for your long-term research success. But signing up for too many disparate tools will only fragment and silo your data. So, you’ll want to find a beginner-friendly platform that has all the capabilities you need in one place. For more intricate studies like MaxDiff or Conjoint, automation is another consideration that can save you time and stress. And, consider providers that offer supportive services that can guide your research as needed.
Design Your Survey with Respondents in Mind: Long monotonous questionnaires often lead to respondent fatigue and - thus- data degradation. You'll want to keep your surveys short, sweet, and to the point, if you want actionable results. Check out our blog All About Survey Design, for an in-depth look at building better surveys.
Distill Your Findings into Actionable Insights: When analyzing your data, you’ll want to do a deep dive, not a shallow skim. If that sounds difficult- don't stress- it’s not. Using automated tools, you can easily test for significance, find correlations, spot patterns, and segment your respondents by demographic, geographic, behavioral, or psychographic data. And if you've got a team or investors on board, you will want to share these findings with them. This will make implementing your insights that much easier.
Getting Insights for Your Startup with SightX
The SightX platform is the next generation of consumer insights tools: a single, unified solution for consumer engagement, understanding, advanced analysis, and reporting. While it's powerful enough for insights teams at Fortune 500s, its user-friendly interface makes it simple for anyone to start, optimize, and scale their research.
Plus, with SightX's assisted research services you can gain access to the best thinking in the consumer insights field. Our team of in-house experts will guide you through every step in the market research process, from survey development, scripting, analysis support, and everything in between.
If you're ready to remove the guesswork from your decision-making, reach out to the SightX team to get started.