Market research is critical before you spend time and money developing a new product or service. Use your market research to determine if your business will be viable or not.
There are many things to think about when starting a business, such as the competition and whether the business will survive in the market you are entering.
Market research involves finding answers to questions like:
Identifying customers – Is there a market for my product? How much will they pay for it?
Your industry may comprise of different customers with different buying habits. Some may choose to impulse buy while some may prefer taking their time and getting assistance from others. To make to most of your marketing opportunity you need to have a good understanding of how your customer thinks and what factors influence their buying habits. You will also need to know how much this market will be willing to pay for your goods and service. Look at your competition and see what they are charging. Are you able to compete with these prices?
Identifying competitors – Who are my competitors? What can I do better or differently to them? Does it matter that I have competition?
Your competitors are those companies that you can identify that offer similar products or services at comparable prices to the same group of customers. These can be either direct or indirect competitors.
Direct competitors – businesses that sell the same or near-identical products or services. For example, Kodak identifies Fuji as a major or direct competitor for camera products.
Indirect competitors – these are businesses that sell similar, but not exactly identical products or provide the same service. For example, Kodak and Fuji identify Apple as an indirect competitor because it offers iPhones with digital cameras as an integrated feature.
How is your product or service better than your competitors what is your unique selling proposition ? The task of coming up with a USP can sometimes be difficult. But every company needs to do this, it sets you apart from your competitors.
Having completed your market research you will be in a better position to determine if you have a successful business or not.
This link has a great comprehensive link to what you need to look at and where to find your information when you start doing your market research. http://www.smallbusiness.wa.gov.au/market-research/
